News
Jumia Makes Impact in Secondary Cities Despite Infrastructure Deficit
Low internet penetration, bad road network and infrastructure deficit were among the hindrances identified to forestall e-commerce success in its early days in Nigeria.
This was largely due to the fact that the majority of the country’s population lived in rural areas. This was – and still – the situation in major African markets. The only exceptions are North African countries, because they have over 70% urban population.
While internet penetration is fastly growing and driving online activities among the people in Nigeria, the road infrastructure needed to get items delivered at sub-hub locations are not growing at commensurate proportion.
Though ecommerce brands like the market leader, Jumia deploy initiatives like Jforce, remote pickup stations and delivery hubs to take the services closer to the people, there are still mitigating factors such as extremely bad roads that make it impossible for delivery agents to access certain locations.
Irene Emede runs Fitfeett Collections Logistics in Benin. She is excited that residents, despite availability of local markets, are making use of online services for groceries and other daily needs. “The interesting thing that really amazes me is despite the local markets we have around here, we still have customers ordering groceries like Rice, Groundnut oil and Spaghetti. And you still see them going there to order for their clothes,” she stated.
Irene however lamented the negative impact the state of roads in the area is having on delivery of items to customers. “One of the major challenges we have is our bad road.
For instance, the road that leads to Ugbiyoko to Ekenwa down to Barrack road is very bad and is not really helping us. Our delivery associates are not able to take their vehicles down there and for that reason, they go there for delivery by foot which is very stressful.
“So most of the items we deliver there are the little items that are easy to carry because they can’t carry large items on their heads simply because they want to make delivery and the bus drivers make things worse by charging them.”
Another negative side to this is the danger it poses to delivery agents, and safety of goods, considering the current state of insecurity across the country. (Name) explained that the company takes precaution by ensuring that items going to such locations are small and not high earned.
“Most of the items taken to that axis for delivery are not high-value items and they are very small. This is for them to be able to overcome the insecurity over there in case of any that may come up.”
Interestingly, the deplorable state of roads has also created a market for electric car jack in the area, selling among female car owners.
“We have this electric carjack that most of the females use simply because they don’t really have the strength to jack their car whenever their car breaks down on their way out,” she explained.
As e-commerce brands put in efforts to drive market penetration in Nigeria, a lot more will be achieved if relevant authorities can help with road infrastructure. E-commerce and logistics are inseparable and both occupy crucial space in the growth of the digital economy, which is one of the major economic goals of Nigeria.
News
NELFUND Says UTME, NIN, BVN Mandatory for Student Loans
Nigerian Education Loan Fund (NELFUND) has said that Nigerian students will need to present their Unified Tertiary Matriculation Examination registration number (UTME); National Identification Number (NIN); and Bank Verification Number (BVN) to access student loans.
Mr Akintunde Sawyerr, managing director of NELFUND, assured that the body would ensure that those he called ‘ghost students’ would not have access to the soon-to-be-launched scheme.
The MD noted that NELFUND has put processes in place to ensure that all applicants and beneficiaries are traceable to prevent the loan from turning into a sort of national cake.
“We are using technology to run the system. The process of application is online and we are limiting human contact as much as possible. Once you have a Bank Verification Number, BVN and National Identification Number, NIN, which are parts of the requirements, we will have access to your data and all your accounts. This will also help us to know if you are qualified or not,” he explained.
He explained further that those who are already in school can apply for the loan at any level of their study, but must be at the beginning of each session. They would also have to provide their admission and matriculation details in addition to BVN and NIN.
According to the NELFUND boss, about 1.2 million Nigerian students in tertiary institutions and government-recognized skill acquisition centres would be among the first batch of beneficiaries. The number may increase as time goes on.
The programme, he noted, will be funded with one per cent of the total annual collectable revenue by the Federal Inland Revenue Service (FIRS), which will amount to N194 billion if the agency meets its projection.
He explained that the loan would be paid in two segments. The first, he said, is the chargeable school fees which would be paid directly to the institutions while stipend would be paid into individual student’s account for day-to-day upkeep.
Mr. Sawyerr stated that the amount individual applicants will access will vary because of the course of study, school fees payable and geographical location of the institutions among others.
On the method of payback, he said, “You don’t start paying back the loan until two years after your National Youth Service Corps, NYSC Scheme and that is, if you have secured a job or business. A beneficiary can defer repayment if he has not secured a job, but if after due diligence, he defaulted, then he becomes a criminal and we will work with every agency that can help us get the money back, for example, EFCC, ICPC etc.”
News
Sun International Finalizes $14.4M Exit from Nigeria, Sells Interests to RFC
Sun International Limited, run by Anthony Leeming, South African entrepreneur, has agreed to sell its Nigerian interests to Rutam Finance Company Limited (RFC) for roughly $14.4 million.
The move is part of Sun International’s strategy to consolidate operations and focus on key markets. Sun International joined the Nigerian market in 2009, but has struggled in recent years due to a challenging operating climate.
This divestiture is consistent with the company’s strategic objectives and represents a shift in portfolio management.
Sun International, will sell a 43.3 percent ownership investment in Tourist Company of Nigeria PLC (TCN), which manages Lagos’ Federal Palace Hotel, to RFC for $1.875 million.
In addition, the group would pay off its whole $12.675 million credit to RFC, effectively exiting the Nigerian market. The corporation also intends to sell its remaining 6% ownership in TCN in due course.
The transaction, subject to customary closing conditions including as regulatory approvals, is estimated to create a cash inflow of about $14.41 million for Sun International.
These funds will be utilized to reduce debt.
Following the completion of the acquisition, TCN will no longer be included in Sun International’s financial statements.
This will reduce group debt by about $41.82 million, excluding IFRS 16 lease liabilities.
The closing is scheduled for no later than May 28, 2024, provided that all usual closing conditions are met. The Nigerian Competition Authority, the Securities and Exchange Commission, and the Nigerian Stock Exchange have all provided key clearances.
Sun International, founded in 1968 by the late Sol Kerzner, has grown into a renowned gaming and resort company under Leeming’s leadership.
In fiscal 2023, the company’s revenue increased by 7% to $646.14 million, while headline earnings increased by 86 percent to $55.35 million.
This demonstrates Sun International’s resiliency and strategic direction. Sun International’s pullout from Nigeria demonstrates the company’s dedication to streamlining its portfolio and pursuing growth possibilities in key areas.
With a rich history and a focus on the future, this transaction demonstrates the company’s commitment to create wealth for shareholders and stakeholders while also strengthening its position in the gaming and hospitality industries.
News
Sam Darwish, US-Nigerian Businessman Suffers $6m Loss as IHS Shares Plunge
Sam Darwish, a US-Nigerian telecom entrepreneur, has experienced a huge financial setback in his holding in IHS Holdings following a recent drop in the shares of the top telecom infrastructure company on the New York Stock Exchange (NYSE).
According to data, Sam Darwish’s investment in IHS Holdings has lost $6 million in market value during the last 13 days. This drop reflects increasing selling pressure among NYSE investors.
From March 12 to 30, Darwish’s investment in IHS Holdings increased from $35.17 million to $49.27 million, resulting in a $14 million gain.
Darwish founded IHS Holdings in 2001, and it has since grown to become the largest telecom infrastructure business in Africa, Europe, Latin America, and the Middle East.
It is renowned for its huge tower count and is the world’s third-largest independent international tower firm.
In the last 13 days, IHS Holdings shares on the NYSE have dropped by 11.72 percent, from $3.67 on April 3 to $3.24 at the time of writing.
As a result, the company’s market capitalization has dropped below $1.1 billion, causing significant losses for stockholders.
As chairman and CEO of IHS Holdings, Sam Darwish holds a critical position in African telecom.
With a strong 4.17 percent ownership holding, equivalent to 13,958,158 ordinary shares, he is a key participant in the global telecom infrastructure business.
The recent double-digit loss in IHS Holdings shares has resulted in a $6 million decrease in the market value of Darwish’s shareholding in the top telecom infrastructure company. His shareholding has decreased from $51.23 million on April 3 to $45.22 million.
Despite this defeat, Darwish remains an important figure in the worldwide telecom business.
IHS Holdings’ extensive tower network and smart acquisitions have secured its position as a major participant in the global telecom infrastructure sector.
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